Market Outlook NDX for Oct 16th '07

Dominant TF: Daily and low time frames (15mins)
Swings: DN-UP-UP
Market direction: Congestion - Up bias still valid.

60mins: 2156 is pivot level. NDX should go slightly lower.
Couldn't have been more right yesterday. We were in presence of a classic pattern, which turned into a textbook Fib expansion to 2143. As the pattern is now complete, we only have a few clues about what is coming next. A negative bias is still in the market, but energy is not high enough to carry NDX much lower right now.
Levels to watch: around 2120 (Fib at 2117 and MM at 2125). 2156 is pivot in lower time frames, so one may also see some seemingly congestion at this time frame while lower time frames test this level up or down.
The 15mins chart is the most significant right now.


Daily: Up until...
AdStoK and Entropy are now showing some early signs of weakness and significance level is still the highest of all 3 on this chart.
There is however so much accumulated energy (in Entropy) that one cannot imagine a serious retracement right now, but one could certainly have a pause with some congestion and profit taking. This high volatility environment can also obviously accelerate movements in either direction, but that would take a few days to materialize.
For the time being, i would recommend keeping an eye on the formation of a clearer pattern (H&S, DT, or breakout) in intraday time frames.


Weekly: Mildly UP until resistance is found
AdStoK lines have now crossed over so NDX may be a little ahead of itself, but significance level is so low at this time frame (divergence) that we should not jump to conclusions.
A crossover is very often a decision point, but we shall draw more information from lower time frames for now.